Whitehaven Coal Limited Earnings Missed Analyst Estimates: Here's What Analysts Are Forecasting Now

Whitehaven Coal Limited (ASX:WHC) shareholders are probably feeling a little disappointed, since its shares fell 4.7% to AU$7.13 in the week after its latest interim results. Statutory earnings per share fell badly short of expectations, coming in at AU$0.32, some 37% below analyst forecasts, although revenues were okay, approximately in line with analyst estimates at AU$1.6b. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

View our latest analysis for Whitehaven Coal

Following the latest results, Whitehaven Coal's ten analysts are now forecasting revenues of AU$4.17b in 2024. This would be a notable 8.4% improvement in revenue compared to the last 12 months. Statutory earnings per share are expected to tumble 31% to AU$0.95 in the same period. In the lead-up to this report, the analysts had been modelling revenues of AU$4.26b and earnings per share (EPS) of AU$1.04 in 2024. It's pretty clear that pessimism has reared its head after the latest results, leading to a weaker revenue outlook and a minor downgrade to earnings per share estimates.

The analysts made no major changes to their price target of AU$8.22, suggesting the downgrades are not expected to have a long-term impact on Whitehaven Coal's valuation. There's another way to think about price targets though, and that's to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Whitehaven Coal analyst has a price target of AU$11.40 per share, while the most pessimistic values it at AU$6.00. This is a fairly broad spread of estimates, suggesting that analysts are forecasting a wide range of possible outcomes for the business.

Of course, another way to look at these forecasts is to place them into context against the industry itself. We would highlight that Whitehaven Coal's revenue growth is expected to slow, with the forecast 18% annualised growth rate until the end of 2024 being well below the historical 27% p.a. growth over the last five years. By way of comparison, the other companies in this industry with analyst coverage are forecast to grow their revenue at 0.2% annually. Even after the forecast slowdown in growth, it seems obvious that Whitehaven Coal is also expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. They also downgraded Whitehaven Coal's revenue estimates, but industry data suggests that it is expected to grow faster than the wider industry. The consensus price target held steady at AU$8.22, with the latest estimates not enough to have an impact on their price targets.

With that said, the long-term trajectory of the company's earnings is a lot more important than next year. We have forecasts for Whitehaven Coal going out to 2026, and you can see them free on our platform here.

You should always think about risks though. Case in point, we've spotted 4 warning signs for Whitehaven Coal you should be aware of, and 2 of them make us uncomfortable.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.